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Many people are alarmed when they receive a notice saying, "We cannot pay your cancer insurance benefit because you failed to disclose your past medical history." However, a breach of the duty of disclosure does not automatically mean the benefit will be denied. Contract termination and benefit payment are separate legal issues, and the key factor is the causal link between the undisclosed illness and the claimed illness.

[Table of Contents]

1. What a breach of the duty of disclosure and contract termination mean

2. Contract termination and benefit payment are separate issues

3. Without a causal link, the diagnosis benefit must be paid

4. Do not casually sign the insurer's confirmation or consent forms

5. How Cheongchul Law Firm can help

1. What a breach of the duty of disclosure and contract termination mean

When entering an insurance contract, the policyholder has a duty to truthfully disclose material facts the insurer asks about, particularly past medical history. This is known as the duty of disclosure (the pre-contract duty to inform). If you fail to properly disclose your medical history at the time of enrollment, the insurer may terminate the contract under Article 651 of the Commercial Act (상법 제651조).

However, the fact that the contract can be terminated is an entirely different matter from whether the insurer can refuse to pay benefits for an insured event that has already occurred.

2. Contract termination and benefit payment are separate issues

Many people mistakenly believe that "if the contract is terminated, of course no benefit can be received." But contract termination and benefit payment must be assessed separately as legal matters.

Article 655 of the Commercial Act (상법 제655조) provides that even when a contract is terminated for breach of the duty of disclosure, the insurer must still pay benefits if there is no causal link between the undisclosed fact and the occurrence of the insured event. In other words, termination by the insurer does not in itself extinguish the right to claim benefits.

3. Without a causal link, the diagnosis benefit must be paid

Ultimately, the decisive factor in benefit payment is the causal link between the previously undisclosed illness and the illness now being claimed.

For example, suppose you did not disclose a history of knee treatment but are now claiming a stomach cancer diagnosis benefit. A medical and legal causal link between a knee condition and stomach cancer is generally difficult to establish. The undisclosed fact cannot be regarded as the cause of this insured event (the stomach cancer diagnosis).

Where no causal link is recognized, the stomach cancer diagnosis benefit may be payable even if the contract is terminated. Therefore, even if your claim has been denied, there is no need to give up immediately.

4. Do not casually sign the insurer's confirmation or consent forms

During a benefit dispute, the insurer may ask you to sign a confirmation or consent form. Such a document may contain, without your full awareness, a clause amounting to consent to the non-payment of benefits.

Once signed, it becomes far more difficult to contest the benefit afterward, so you should not sign immediately without fully reviewing the contents. Based on objective evidence such as your attending physician's opinion, you should clearly assert the absence of a causal link, and it is safest to have a lawyer fact-check the situation before signing.

5. How Cheongchul Law Firm can help

Disputes over denial of benefits based on a breach of the duty of disclosure involve a complex mix of medical causation, policy interpretation, and Commercial Act principles, so the initial response often determines the outcome. From the benefit claim stage through the denial notice, consent form review, and litigation, Cheongchul Law Firm responds with lawyers who work directly on each case to protect our clients' rights to the end.

If your benefit has been denied due to undisclosed past medical history, please contact Cheongchul Law Firm before signing anything or agreeing to a settlement.

This post is provided for general legal information purposes only and does not constitute legal advice on any specific matter. The outcome of an individual case may vary depending on the facts, so please consult an attorney.